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ELCAllowedELC Appeal from ELCC CMCC No. 15 of 2018· [2024] KEELC 6087 (KLR)

Mwatu v Ngumbao & another (Environment and Land Appeal E006 of 2023) [2024] KEELC 6087 (KLR)

Environment and Land Court
25 September 2024
SKS. M. KIBUNJA
4,176 words in judgment
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The bottom line

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What this practically means

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Executive summary

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The appellant appealed the judgment of Hon. Nabibya delivered on 27th October 2022 in ELCC CMCC No. 15 of 2018, which dismissed his claim to a plot at Mariakani bought from the 1st respondent by agreement dated 8th August 2011, and which had declared the 2nd respondent an innocent purchaser for value without notice and allowed her counterclaim. The appeal raised three issues: whether the 2011 agreement was a sale or lease, whether the 2nd respondent was a bona fide purchaser, and costs. Relying on Mursal v Manese and Santosh Hazari, the court rehearsed the evidence. It found the 8th August 2011 agreement was a sale, not a lease, corroborated by PW2, and that the appellant discharged the burden of proof under Section 107 of the Evidence Act. The 1st respondent had no basis to demand ground rent or resell the plot with the appellant's structure to the 2nd respondent without compensating the appellant. On the bona fide purchaser test in Katende v Haridar, the court held the 2nd respondent failed to exercise due diligence; her appearance before the chief should have alerted her to the appellant's prior claim, so she was not an innocent purchaser. The court further held that the trial court erred in denying the appellant compensation merely because refund was not pleaded, invoking Article 159(2)(d) and the overriding objective, since otherwise the 1st respondent would be unjustly enriched. The court allowed the appeal, set aside the trial judgment, entered judgment for the appellant as prayed in the plaint, granted the 2nd respondent's counterclaim for Kshs.1,300,000 against the 1st respondent, and ordered the 1st respondent to bear costs in the trial court and the appeal.

Key legal issues

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01

Whether the agreement of 8th August 2011 was a sale or a lease

Holding

It was a sale agreement; the 1st respondent had no basis to demand ground rent or resell the plot

Reasoning

The written agreement dated 8th August 2011 contained clear terms on purchase price and no clause for monthly ground rent. PW2, a witness to the agreement, corroborated the sale. The 1st respondent produced no lease agreement and no witness corroborated the lease narrative. He therefore had no right to demand ground rent arrears or resell the plot with the appellant's development.

p. 7
02

Whether the 2nd respondent was an innocent purchaser for value without notice

Holding

She was not; she knew of the appellant's prior claim

Reasoning

The 2nd respondent appeared before the chief during the dispute over the property, which should have alerted her to the appellant's claim. She relied only on the 1st respondent's representations without conducting due diligence or confirming the appellant's claim had been settled. Her payment of Kshs.500,000 was not disputed, and she may be compensated via her counterclaim.

p. 8
03

Whether the appellant could be compensated despite not pleading a refund

Holding

Yes; the trial court erred in denying relief purely on pleading grounds

Reasoning

The court invoked Article 159(2)(d) of the Constitution and the overriding objectives of the Civil Procedure Act and ELC Act, holding that having found the appellant was the first buyer whose money and structure were resold, the trial court should not have left her without compensation, as that would sanction the 1st respondent's unjust enrichment.

p. 6
04

Whether the trial court's dismissal of the appellant's claim should stand

Holding

The trial magistrate erred in fact and in law; the judgment was set aside and substituted

Reasoning

Having found the agreement was a sale, the appellant discharged her burden of proof under Section 107 of the Evidence Act, and the 2nd respondent was not a bona fide purchaser, the court concluded the dismissal of the appellant's claim was erroneous and entered judgment for the appellant as prayed, while granting the 2nd respondent's counterclaim for refund against the 1st respondent.

p. 8

Legal principles established

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  • A first appeal is open for rehearing on questions of fact and law, and the appellate court must record findings supported by reasons on all issues
  • The legal burden of proof rests on the party who asserts facts supporting a legal right or liability
  • Elements of the bona fide purchaser doctrine as set out in Katende v Haridar

Court orders

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  1. 1.The judgment of Hon. Nabibya delivered on 27th October 2022 dismissing the appellant's claim and granting the 2nd respondent's counterclaim is set aside and substituted
  2. 2.Judgment entered in favour of the appellant as prayed in the plaint dated 26th May 2018
  3. 3.The 2nd respondent's counterclaim against the 1st respondent for refund of Kshs.1,300,000 (purchase price and value of development) is granted
  4. 4.The 1st respondent to bear the costs for both the appellant and 2nd respondent in the trial court and this appeal

Authorities

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Legislation

  • Land Registration ActSection 26
  • Evidence ActSection 107
  • Land Control ActSections 6(1) and 7
  • Constitution of KenyaArticle 159(2)(d)
  • Environment and Land Court ActSection 18(c)
  • Civil Procedure ActSections 1A, 1B, 3A and 27

Cases cited (4)

  • Mursal & Another versus Manese (suing as the legal administrator of Dalphine Kanini Manesa)
    (Civil Appeal E20 of 2021) [2022] KEHC 282 (KLR)
  • Santosh Hazari versus Purushottam Tiwari (Deceased) by L.Rs
    {2001} 3 SCC 179
  • Raila Amolo Odinga & Another versus IEBC & 2 Others
    (2017) eKLR
  • Katende versus Haridar & Company Limited
    [2008] 2 E.A. 173
On appeal from
Magistrates' Court (ELCC)
ELCC CMCC No. 15 of 2018
Jurisdiction invoked
First appellate jurisdiction over the trial court's judgment in ELCC CMCC No. 15 of 2018

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Mwatu v Ngumbao & another (Environment and Land Appeal E006 of 2023) [2024] KEELC 6087 (KLR)", Case Analysis (2024). ELC Appeal from ELCC CMCC No. 15 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keelc/2024/6087/eng@2024-09-25

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.